Tax Benefits of Thai ESGX Fund
There are 2 categories of tax benefits available when investing in Thai ESGX funds as follows
- Category 1 Investors who invest in Thai ESGX funds between May 2, 2025 to June 30, 2025 are eligible for a tax deduction of the actual amount up to 30% of the individual’s annual assessable income and can invest up to a maximum of 300,000 baht. (This is separate from the tax benefits limits for investments in Thai ESG funds)
- Category 2 Existing unitholders who switch all LTF units held with all asset management companies as of March 11, 2025 (excluding units under other tax-benefit classes such as SSF) into Thai ESGX funds between May 2, 2025 to June 30, 2025, are eligible for a maximum tax deduction of 500,000 baht over five years. In the first year (2025), the maximum deductible amount is 300,000 baht, and the remaining amount will be equally distributed up to not more than 50,000 baht per year across the 2026 to 2029 tax years.
(Investments in Thai ESGX funds are not combined with the tax deduction from investments in Thai ESG funds and are not combined with the total of tax deductible investment of up to 500,000 baht allowable from investments in Retirement Mutual Fund (RMF), provident funds, government pension funds, private teacher aid fund contributions, national savings fund and annuity insurance premiums.)
Conditions of Thai ESGX Fund
Investments in Thai ESGX funds must be held for at least 5 consecutive years from the date of the purchase or switch of investment units to the anniversary date, except in the event of disability or death of the investor.
Breaching Investment Conditions of Thai ESGX Fund
In the case that the investment exceeds tax privileges
- Investments that exceed tax privileges are not eligible for tax deduction.
- Capital gains incurred from redemption of the investment which exceed tax benefits must be incorporated into other income as taxable income.
In the case that the tax privilege was acquired and the investor breached conditions
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Investors must pay the income tax for the tax year during which the investment was deducted from income tax for exemption to the Revenue Department.
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Investors must pay a surcharge to the Revenue Department at a monthly rate of 1.5% on the exempted tax amount but not more than the tax payable amount. The period designated to pay the surcharge will be after the last day of tax filing, or the remittance period of the year the investor applied for tax exemption until the date of payment or remittance of additional taxes. It is suggested that the investor should pay as soon as possible.
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If there are capital gains incurred from redemption, investors are required to:
- Pay withholding taxes calculated according to their tax rates.
- Incorporate the capital gains incurred from redemption as a taxable income.
Breaches of investment conditions 1 to 3 are not applicable in the event of disability or death of the investor, in accordance with the conditions of the Revenue Department.
In this regard, investors must comply with the regulations stated in the Thai ESG handbook